Bankruptcy

"Straight" Bankruptcy: Chapter 7

There are several types of bankruptcy, each provided in a separate chapter of the Bankruptcy Code, a federal statute. Proceedings under Chapter 7 (straight bankruptcy) involve surrendering most of the borrower's nonexempt assets. A bankruptcy trustee is appointed in every Chapter 7 case to administer the nonexempt assets (if any) and distribute either the assets themselves or the proceeds from selling (liquidating) them among the creditors.

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